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CHAPTER AFFILIATION TOOLKIT Helping Chapters Meet Criteria for Affiliation 2013
The American Hospital Association v. June, 2013
PLACE PMG LOGO HERE
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TABLE OF CONTENTS
I) Communication Documents
1) Executive Summary message to Chapter leaders 2) Email Blast to Chapter leaders (same as Tool Kit Executive Summary message) 3) Letter to Chapter Leaders explaining Tax Exemption Instructions
II) AHA/PMG Chapter Affiliation Agreement (CAA) ..
III) Must Haves For All Chapters .. 17
1) Bylaws 2) Federal Employer Identification Number 3) Minutes
IV) Incorporation 29
1) Incorporation: Why and How 2) Articles of incorporation
V) Tax Exempt Status 4
1) Tax exempt status (501 C3, 4 or 6) 2) Application for Tax Exempt Status 3) Tax filings: 990, 990EZ or 990N 4) Other relevant tax forms (ie: 1099 if relevant)
VI) Insurance 6
VII) Link to webinar recordings 5
VIII) PMG chapter website contents 1
IX) Membership Recruitment Tips 2
X) Membership Roster Template 3
XI) Year End Chapter Report Template 4
XII) Resources for Obtaining a Bank Account 7
XIII) Newsletter Template .. 8
XIV) Appendix .. . 1
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I) COMMUNICATION DOCUMENT
Executive Summary
Letter explaining the PMG Chapter Affiliation Agreement and Tool Kit.
Email Templates
Email template explaining the PMG Chapter Affiliation Agreement and Tool Kit.
Tax Exemption Instructions for AHA/PMG Chapters
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Executive Summary and E-mail letter TEMPLATE Dear Chapter Leaders, On behalf of the Division of Personal Membership Groups of the American Hospital Association, I am pleased to share several resources to help you develop or enhance your chapter activities. The AHA/PMG Chapter Affiliation Tool Kit (v. March 2013) contains instructions for establishing your chapter as a non-profit entity as well as other forms to help you comply with the terms of the AHA/PMG Chapter Affiliation Agreement. Our primary goal in changing the Affiliation Agreements with PMG chapters is to minimize the risk of the PMG-Chapter relationship while fostering a relationship of collaboration on behalf of the profession each entity serves. The revised Chapter Affiliation Agreement was developed by staff with AHA Legal and outside legal counsel with expertise in non-profit organizations. The Agreement represents a commitment to the valuable role of chapters and the necessity of defining their relationship to the PMGs/AHA. The new Agreement includes two levels of Affiliation, each with criteria that must be maintained by the chapters. Any Chapter wishing to be an affiliate must sign the agreement. Once affiliated, the Chapter will be required to share specific documentation with their PMG on an annual basis. The agreement does not need to be signed annually. The following pages include a number of documents, samples, and instructions for complying with the Chapter Affiliation Agreement. The Tool Kit and other resources will be available on the PMG chapter website pages and will be updated regularly. If you have further questions about the Affiliation Agreement, please contact your PMG staff. Sincerely, Elizabeth Summy, MSc., CAE Vice President, Personal Membership Groups American Hospital Association March, 2013
American Society for Healthcare Engineering (ASHE)
Association for the Healthcare Environment (AHE)
Association for Healthcare Resource & Materials Management
(AHRMM)
American Society for Healthcare Risk Management (ASHRM)
Society for Healthcare Strategy and Market Development (SHSMD)
Association for Healthcare Volunteer Resource Professionals (AHVRP)
American Society for Healthcare Human Resources Administration
(ASHHRA)
Society for Healthcare Consumer Advocacy (SHCA)
mailto:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]:[email protected]
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Tax Exemption Instructions for AHA/PMG Chapters
We are providing the following information to help your Chapter obtain tax-exempt status. Obtaining
this status will exempt your Chapter from paying federal income tax on net income related to its
mission. Otherwise the Chapter is responsible for filing a business tax return, such as form 1120, and
paying federal income tax on all net income.
The tax exemption process will involve the following:
1. File Articles of Incorporation by incorporating, your Chapter will help limit the personal liability
tain the form for
incorporating nonprofit corporations form the Secretary of State website of the state where
your chapter is based. Complete the form and file with the applicable Secretary of State. A
sample form Articles of Incorporation is enclosed with sample language to include in the
2. Obtain Employer Identification Number Complete and file Form SS-4 with the IRS to obtain
tion Number. A sample Form SS-4 is enclosed. You can also
apply online at https://as2.www4.irs.gov/modiein/individual/index.jsp. This number will be
unique to your newly incorporated Chapter and should be inserted on the Form 1024
Application for Recognition for Tax Exemption (discussed below).
3. File Form 2024 (Application for Recognition of Exemption) once you have incorporated your
Chapter and obtained your Employer Identification Number, you can complete Form 1024
(Application for Recognition of Exemption) and mail the form along with the attachments
(including Articles of Incorporation and Bylaws) and a check payable to United States Treasury
($400 check if annual receipts are less than $10,000; otherwise a check for $850) to the IRS at
Internal Revenue Service, P.O. Box 12192, Covington, KY 41012-0192.
a. A sample Form 1024 that has been partially completed using a fictional Chapter is
included below. Review and complete the form and attachments before sending to the
IRS. You will receive confirmation of your exemption by mail from the IRS.
4. File Federal Information Return with the IRS You are required to file one of the following
information returns with the IRS, which will be due five (5) months and 15 days after the end of th for fiscal years ending December 31).
a. Form 990-N (e-postcard filed electronically at http://epostcard.form990.org) File if
annual gross receipts are normally less than $50,000.
b. Form 990-EZ File if annual gross receipts are normally less than $200,000 (and greater
than $50,000), and total assets are less than $500,000.
c. Form 990 File if you are not eligible for Form 990-N or Form 990-EZ.
Also, check with the Department of Revenue of the state where your Chapter is based to determine
whether any state information filings are due.
More information can be obtained on the tax exempt process on the IRS website by searching
1024 Instructions.
https://as2.www4.irs.gov/modiein/individual/index.jsphttp://epostcard.form990.org/
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II) CHAPTER AFFILIATION AGREEMENT
PMG Chapter Affiliation Agreement template follows.
SAMPLE ASSOCIATION FOR HEALTHCARE RESOURCES & MATERIALS MANAGEMENT
of the
American Hospital Association
CHAPTER AGREEMENT
This Agreement, effective , 2013, is made between
the Association for Healthcare Resources & Materials Management of the American Hospital Association
AHRMM ois non-profit corporation,
and , (the
rk together as follows:
1. GRANT OF CHAPTER STATUS
1.1 Charter. AHA hereby grants to the Chapter, and the Chapter accepts by action of
its governing body, a charter to be a chapter of AHRMM. The Chapter shall use only the designation "An
independent chapter of AHRMM Association for Healthcare
Resources & Materials Management
activities of the Chapter in conformance with AHRMM ibit A, as the same
may be changed by notice from AHRMM.
1.2 Charter Grant Not Exclusive. Chapter is not entitled to any geographic or other
exclusive right to solicit or serve members or operate as a chapter of AHRMM. AHRMM may, in its
sole discretion, conduct its own activities within any geographic territory or region served by Chapter
during the term of this Agreement. In addition, AHRMM may grant a charter to an existing or new
chapter operating or intending to operate within any geographic territory or region served by Chapter.
Chapter intends to focus its activities in the state of or __________ area.
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1.3 Criteria to Maintain Chapter Status. In order to maintain chapter status, Chapter
must meet the criteria set out in Exhibit B by the indicated deadlines, and maintain compliance with such
criteria on an ongoing basis as described in Exhibit B. AHRMM reserves the right to change the criteria
for chapter status. In the event of any such change, AHRMM shall notify the Chapter no less than 120
days prior to the date such change takes effect. If the Chapter does not wish to comply with any such
change in order to retain its chapter status, the Chapter may exercise its termination rights set out in
Section 8 below.
2. OBLIGATIONS OF AHRMM
AHRMM
2.1 AHRMM shall:
a) Permit the Chapter to utilize the AHRMM name in the name of the Chapter,
provided that the Chapter adds words distinguishing the Chapter from AHRMM
as required by Section 1.1, and adds words distinguishing the Chapter from any
existing Chapters of AHRMM.
b) Identify an AHRMM staff liaison as a point of contact to maintain and enhance
the AHRMM-Chapter relationship.
c) Provide all chapters, periodically, with a statement of chapter benefits that
identifies the services to be provided to help chapter leaders offer opportunities
for chapter education and networking events and to communicate with chapter
members.
d) Notify the Chapter of educational and other opportunities available to
Chapter members, including those activities of AHRMM that will take
place within the area served by the Chapter.
e) Upon the request of the Chapter and space considerations permitting,
post current information supplied by Chapter relating to its programs,
products and services on the AHRMM website page devoted to chapter
activities.
f) Upon the request of the Chapter, provide an up-to-date list of AHRMM
members residing in ____________ [fill -in state or region to be included
in the list] showing member name, organizational name and mailing
address ; provided, AHRMM shall not be
required to provide the AHRMM Mailing List more often than once per
year of this Agreement and use of the list shall be subject to the
requirements in Section 3.2.
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3. OBLIGATIONS OF THE CHAPTER
The Chapter's obligations under this Agreement shall include the following:
3.1 The Chapter shall:
a) Promote membership in AHRMM.
b) Promote and encourage the use of AHRMM programs, products and services.
c) Comply with the criteria for chapter status in effect based on the applicable time
period as set out in Exhibit B.
d) Using the current template provided by AHRMM, supply an up-to-date chapter
member list including member name, organization name, mailing address and
email address (i) within 30 days after the date this Agreement is signed, and
(ii)annually thereafter with the Annual Report required by subsection f, below.
e) Supply a preliminary calendar of Chapter events for the upcoming year with the
Annual Report required by subsection f, below.
f) Using the current template provided by AHRMM, submit an Annual Report
certifying compliance by Chapter with the applicable criteria for chapter status
set out in Exhibit B no later than January 31 of each year.
3.2 Use of AHRMM Mailing List. Chapter agrees that each AHRMM Mailing L ist
may be used once to promote Chapter programs and activities and that no AHRMM Mailing L ist may be
resold or used to promote a third party. Chapter agrees to provide a copy of the material to be mailed to
AHRMM members with its request and AHRMM reserves the right to refuse a list request if AHRMM
determines in its sole discretion that the activities promoted in such material would result in a conflict
with AHRMM activities.
3.3 Other National Personal Membership Organizations. The Chapter shall refrain
from entering into an official relationship with another national scope personal membership organization
without prior written approval of AHRMM.
3.4 Access to Records of the Chapter. Upon request by AHRMM, the Chapter shall
provide AHRMM with such copies of records and such other information as AHRMM may reasonably
request ria for chapter status set out in Exhibit B. Chapter
shall provide such materials to AHRMM no later than 15 days after the date Chapter receives the request.
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4. COMPLIANCE WITH LAWS
4.1 Compliance with Laws. Each party warrants that it has and shall continue to
comply with all applicable laws, regulations, and other requirements that may affect its performance of
this Agreement. Each party warrants that it shall make all required filings, such as annual corporate
filings and tax filings, as may affect its corporate or tax status.
5. USE OF AHRMM TRADEMARK AND MATERIALS
5.1 Use of AHRMM Trademark and Materials. Except as specified in Section 1.1,
the Chapter shall not use, or cause or permit to be used by any person, the logos, trademarks, service
marks, or trade names of AHRMM without AHRMM's prior written consent. In accordance with United
States copyright law, the Chapter shall not make or cause to be made any copies of AHRMM
educational materials or membership publications, or resell any of same, without AHRMM's prior written
consent. With respect to any permitted use of AHRMM's logo, mark, name, or copyrighted materials, the
Chapter shall ensure that the applicable copyright or trademark notice is made, pursuant to requirements
of U.S. law, the laws of applicable states, and any other guidelines that AHRMM shall prescribe. In any
event, upon expiration or termination of this Agreement, all use by the Chapter of AHRMM's proprietary
property, such as logos, marks, names, or copyrights, shall end immediately. The Chapter's obligations
under this Section 5.1 shall survive the expiration or termination of this Agreement.
6. CONFIDENTIAL INFORMATION
6.1 Confidential Information. Each party shall, during the term of this Agreement
and ther
information or data owned by the other party which is identified as confidential at the time it is disclosed
(collectively, "Confidential Information"). Such Confidential Information shall at all times remain the
property of its owner and shall be deemed to be furnished in confidence and solely in connection with the
, the party
shall immediately deliver to the owner all written documentation, including copies, of or concerning such
Confidential Information, shall make no further use thereof, and shall make reasonable efforts to ensure
that no further use is made by its employees, agents, or contractors. The confidentiality obligations under
this Section 6.1 shall survive the expiration or termination of this Agreement.
7. SEPARATE ENTITIES
7.1 Separate Entities. AHRMM and the Chapter expressly acknowledge and agree
that they are, and shall remain, separate entities and that no partnership or agency is created by virtue of
this Agreement. As such, neither party shall be authorized to incur any liability, obligation, or expense on
behalf of the other. The Chapter is not liable or responsible for the debts or obligations of AHRMM and
AHRMM is not liable for the debts or obligations of the Chapter.
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8. TERMINATION OF CHAPTER STATUS
8.1 Termination for Failure to Comply with Criteria for Chapter Status. In the event the
Chapter fails to meet the criteria for Level I or Level II status by the deadline for attaining such status set
forth on Exhibit B, or fails at any time to maintain such status as required by Exhibit B, AHRMM may
terminate the charter granted to the Chapter, with all of its attendant rights and obligations, effective ten
(10) days after the date written notice of termination is sent by AHRMM.
8.2 Termination for Breach. Either party may terminate the charter granted to the
Chapter, with all of its attendant rights and obligations, upon ten (10) days notice to the other party in the
8.3 Termination without Cause. Either party may terminate the charter granted to the
Chapter, with all of its attendant rights and obligations, for any reason upon ninety (90) days written
notice to the other party.
8.4 Effect of Termination. Upon delivery of notice of termination, for any reason and by
either party, the Chapter shall promptly deliver to AHRMM a current roster of all members of the
Chapter, including all contact information, to enable AHRMM to communicate with such members.
From and after the date of termination, the Chapter shall cease to identify itself as a chapter of AHRMM,
remove any reference to AHRMM AHRMM
acronym, and may only utilize printed material bearing any mark of AHRMM with AHRMM
written permission for post-termination use. For a period of one year following termination of the charter,
the Chapter shall refrain from entering into an official relationship with another national scope personal
membership organization serving healthcare materials management.
9. WARRANTY; LIMITATION OF LIABILITY
9.1 WARRANTY. AHRMM MAKES NO REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED (INCLUDING IMPLIED WARRANTIES OF
MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE) CONCERNING ANY
EDUCATIONAL MATERIALS, EDUCATIONAL PROGRAMS, MEMBERSHIP PUBLICATIONS
OR ANY OTHER ARTICLE OR SERVICE PROVIDED HEREUNDER. ALL GUARANTEES,
WARRANTIES, CONDITIONS AND REPRESENTATIONS, EITHER EXPRESS OR IMPLIED,
WHETHER ARISING UNDER ANY STATUTE, LAW, COMMERCIAL USAGE OR OTHERWISE
ARE HEREBY EXCLUDED.
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9.2 LIMITATION OF LIABILITY . THE CHAPTER ACKNOWLEDGES AND
AGREES THAT AHRMM AND THE AMERICAN HOSPITAL ASSOCIATION SHALL NOT BE
RESPONSIBLE FOR ANY DAMAGES WHICH THE CHAPTER MAY INCUR FROM ANY CAUSE,
WHETHER LIABILITY IS ASSERTED IN CONTRACT OR TORT (INCLUDING NEGLIGENCE).
IN NO EVENT SHALL AHA BE LIABLE TO ANY PERSON FOR LOSS OF PROFITS, LOSS OF
USE, LOSS OF PRODUCTION, LOSS OF GOODWILL, OR INCIDENTAL, INDIRECT,
CONSEQUENTIAL, OR SPECIAL DAMAGES OF ANY KIND.
10. APPEAL
10.1 Appeal. A Chapter may request an opportunity to present an objection to a
proposed termination under Section 8 of this Agreement to the AHRMM Board of Directors. The
AHRMM Board of Directors shall have authority to review whether the proposed termination is
consistent with the terms of this Agreement and to make a recommendation to the American Hospital
the sole authority to (i) permit the termination to proceed, (ii) suspend the termination for a period of time
to permit the Chapter to meet specified conditions, or (iii) to withdraw the termination notice.
11. MISCELLANEOUS
11.1 Entire Agreement. This Agreement (together with any exhibits hereto)
constitutes the entire Agreement between AHRMM and the Chapter with respect to the subject matter
hereof. This Agreement may be amended only by a writing executed by both parties.
11.2 Controlling Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois, and venue for any litigation arising hereunder shall be
Chicago, Illinois.
11.3 Waiver. Any waiver by either party to this Agreement of any provision shall not
be construed as a waiver of any other provision of this Agreement, nor shall such waiver be construed as a
waiver of such provision with respect to any other event or circumstance, whether past, present, or future.
11.4 Severability. If any provision of this Agreement is determined to be invalid or
unenforceable in whole or in part, the remaining provisions shall be enforceable to the maximum extent
possible.
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11.5 Successors and Assigns. This Agreement shall inure to the benefit of the parties
and their successors and assigns. Neither party may sublicense or assign any of its rights or obligations
under this Agreement without the prior written consent of the other party.
11.6 Notices. Any notice contemplated by, or made pursuant to, this Agreement shall
be in writing and made by courier, facsimile, or mail addressed or directed to AHRMM at 155 North
Wacker Drive, Suite 400, Chicago, Illinois 60606 or the Chapter at the home or business address of the
President of the Chapter in office at the time the notice is sent. Either party may change the address for
notice by 10 days advance written notice to the other party.
11.7 Termination of Prior Chapter Agreement. This agreement supersedes and
replaces any prior chapter agreement between the parties and terminates any such agreement on the
effective date of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives, effective as of the date first written above.
FOR THE CHAPTER:
______________________________________________________________________
(Chapter Name)
______________________________________________________________________
(Signature)
______________________________________________________________________
(Name) _________________________________________
(Date)
FOR THE ASSOCIATION FOR HEALTHCARE RESOURCE & MATERIALS MANAGEMENT OF
THE AMERICAN HOSPITAL ASSOCIATION:
_______________________________________________________________________
(Signature)
_______________________________________________________________________
(Name)
_______________________________________________________________________
(Title)
______________________________
(Date)
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EXHIBIT A
AHRMM STYLE GUIDE/IDENTITY STANDARDS
This AHRMM Style Guide/Identity Standards is subject to change at the sole discretion of AHRMM. AHRMM agrees to
give Chapter no less than 30 days prior written notice of any changes to the Style Guide/Identity Standards.
Style Guide
Proper Use of Logos by AHRMM Affiliated Chapters
identifying AHRMM and what it does. It also helps prevent confusion. Proper use of logos prevents others from being
confused as to which activities, services or materials come from AHRMM versus those that come from a chapter. It is
important to recognize that our names and logos have value, so please help protect the value of our name and logos by
following these guidelines:
Naming Chapters, Products, Services & Events
Do not use a chapter name with the exact acronym as AHRMM.
All chapter names must be pre-approved by AHRMM. Do not use any tagline of AHRMM. Do not use AHRMM name in advertising, product, service or event without prior written approval from
AHRMM.
Spell out the long-form name of your organization in a noticeable area on your materials, website, or other
promotional materials.
or any other AHA trademarks, logos or taglines.
Do not register trademarks, copyrights or other intellectual property that include the AHRMM name,
acronym, logo, or tagline or any derivative thereof.
Do not register a domain name containing our name, acronym, logo, tagline or any derivative thereof.
Designs & Advertising
Design your products and advertising materials with unique brands and logos, or logos pre-approved by
AHRMM.
Do not use AHRMM name, acronym, logo, or tagline in a way that implies a partnership or sponsorship with
AHRMM, or for fraudulent, abusive, or illegal
activities.
Do not copy the look and feel of AHRMM products, advertising materials, or website.
In the first place where our acronym predominantly appears in promotional material, please use the ®
symbol. AHRMM does not require use of the ® in
reference thereafter.
Do not alter AHRMM name or logo in any way inconsistent with the style specification noted below.
Use only the image file supplied by AHRMM. If insufficient for use, please contact AHRMM for an
alternate file.
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The logo and seal may be used by affiliated chapters, only.
Logo Color Specification
Blue: PM280
Tints for triangle = 20%, 50%, 75%.
CMYK color: C89 M50 Y11 K5
RGB color: R64 G118 B171
Web color: 4076AB
Usage rules above apply.
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EXHIBIT B
CRITERIA FOR CHAPTER STATUS
A. Criteria for Level I Chapter Status
Every chapter must meet the criteria for Level I status. In the event Chapter cannot meet the
criteria for Level I status on the date of this Agreement, it must meet such criteria by January 31,
2014 in order to retain chapter status. The Chapter must continue to meet the criteria for Level
I status from that date forward. The Chapter must immediately inform AHRMM of any change
If the Chapter does not meet the
criteria for Level I status at any time one year or more after the date of this Agreement, AHRMM
will terminate chapter status as permitted by Section 8 of this Agreement. Level I chapters
must meet the criteria for Level II status (see B, below) no later than January 31, 2016.
Criteria for Level I Status
1 The chapter must have at least 20 members*.
2 Chapters with less than 100 members must have at least 15 members who are also
AHRMM members*. Chapters with 100 or more members must have a minimum of 15%of
its members who also are PMG members*.
3 The President and President-Elect of the chapter must be AHRMM members*.
4 The chapter must fully execute a chapter agreement with AHRMM.
5 The chapter must have obtained its own Employer Identification Number.
6
7 The chapter must be incorporated as a not-for-profit corporation and be in good standing
in its state of incorporation.
8 The chapter must have started the process for obtaining tax-exempt status from the IRS.
*Must be non-student.
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B. Criteria for Level II Chapter Status
Every chapter must meet the criteria for Level II status by January 31, 2016, as well as
maintaining compliance with the criteria for Level I status. The Chapter must continue to meet
the criteria for Level I and Level II status from that date forward. The Chapter must immediately
inform AHRMM of any change in the compliance with any of these requirements. If
the Chapter does not meet the criteria for Level I and Level II status at any time after January 31,
2016, AHRMM will terminate chapter status as permitted by Section 8 of this Agreement.
Additional Criteria for Level II Status
9 The chapter must have a mission statement that helps advance AHRMM
10 The chapter must be governed by bylaws that are compliant with relevant laws.
11 The chapter must obtain an exemption from federal income taxes under section 501(c) of
the Internal Revenue Service code.
12 The chapter must maintain aggregate general or umbrella liability insurance having a
minimum coverage of $1,000,000 per occurrence and include proof of such insurance with
its annual report.
13 The chapter must maintain directors and officers liability insurance and include proof of
such insurance with its annual report.
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III) Must Haves f or All Chapters
1. Bylaws
Each Chapter, whether it is incorporated or unincorporated, must have bylaws. The bylaws are the
ract with its members. They set forth who can be a member, and how the organization is
governed.
Sample bylaws are attached.
Once bylaws have been adopted, they can only be changed according to the process described in the
bylaws. The provisions of the bylaws cannot be waived because they are inconvenient. If it is not
practical to follow the provisions of the bylaws, they should be amended according to the amendment
process.
2. Federal Employer Identification Number
Each Chapter must have a Federal Employer Identification Number, whether incorporated or
A federal employer identification number may be obtained by filing Form SS-4 with the Internal Revenue
Service. A sample Form SS-4 is attached. Please fill out the form according to the specific information
for your Chapter, using the sample as a guide. The easiest way to obtain the number is to fill out Form
SS-4 online, at http://www.i rs.gov/. It can be filed online, and the federal employer identification
number will be sent to you the same day.
3. Minutes
Each Chapter must keep minutes of its board meetings and meetings of members. The board minutes
should show the date and time of the meeting, which board members were in attendance, the nature of
the business discussed, and the resolutions passed. Meetings of members should reflect the date and
time of the meeting, whether a quorum of members was present, business discussed, and resolutions
passed.
Minutes should be kept with the permanent records of the Chapter. In the event of an IRS audit, the
auditor will most likely ask to see the minutes of the Chapter.
http://www.irs.gov/
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1. Sample Bylaws
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BY-LAWS
OF
_______________________
ARTICLE I
The name of the corporation shall be ________________________.
ARTICLE II
PURPOSES
Section 1. Not For Profit. The corporation is organized under and shall operate as an
Illinois not-for-profit corporation, and shall have such powers as are now or as may hereafter be granted
by the not for profit laws of the state of incorporation.
Section 2. Purposes. The purposes of the corporation are ______________
_____________________________________________________________________________.
ARTICLE III
REGISTERED OFFICE AND AGENT
The corporation shall have and continuously maintain in the state of incorporation a
registered office and a registered agent whose office shall be identical with such registered office, and
may have such other offices within or without the state of incorporation and such other registered
agents as the board of directors may from time to time determine.
ARTICLE IV
MEMBERS
Section 1. Classes of Members. The corporation shall have one class of members. The
qualifications for members are: _______________________________________
_____________________________________________________________________________.
Section 2. Voting Rights. Each member shall be entitled to one vote on each matter
submitted to a vote of the members.
Section 3. Resignation. Any member may resign by filing a written resignation with the
secretary.
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ARTICLE V
MEETING OF MEMBERS
Section 1. Annual Meeting. An annual meeting of the members shall be held in each
year or at such time as the board of directors may determine, at a time and place selected by the board
of directors, for the purpose of electing directors and for the transaction of such other business as may
come before the meeting.
Section 2. Special Meeting. Special meetings of the members may be called either by
the president, the board of directors, or by not less than one-half of the members having voting rights.
Section 3. Notice of Meetings. Written or printed notice stating the place, day and hour
of any meeting of members shall be delivered in accordance with applicable law.
Section 4. Quorum. The members holding at least a majority of the votes which may be
cast at any meeting shall constitute a quorum at such meeting. If a quorum is not present at any
meeting of members, a majority of the members present may adjourn the meeting from time to time
without further notice.
ARTICLE VI
OFFICERS
Section 1. Officers. The officers of the corporation shall be a president, a secretary, a
treasurer and such other officers as may be determined by the board of directors. The board of
directors may elect or appoint such other officers as it shall deem desirable, such officers to have the
authority to perform the duties prescribed from time to time by board of directors. Any two or more
offices may be held by the same person. Officers need not be residents of the state of incorporation.
Section 2. Election and Term of Office. The officers shall be elected by the board of
directors for an annual term. The officers shall be elected at the annual meeting of the board of
directors nearest the expiration of their term of office and shall serve until their successors have been
duly elected and have qualified. Vacancies may be filled or new offices created and filled at any meeting
of the board of directors.
Section 3. Removal. Any officer may be removed by the board of directors whenever in
its judgment the best interests of the corporation would be served thereby.
Section 4. Vacancies. A vacancy in any office because of death, resignation, removal,
disqualification or otherwise, may be filled by the board of directors for the unexpired portion of the
term.
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Section 5. President. The president shall be the principal executive officer of the
corporation and shall in general supervise and control all of the affairs of the corporation. He shall
preside at all meetings of the board of directors and shall be the Chairman of the Board. He may sign,
with the secretary or any other proper officer of the corporation authorized by the board of directors,
any deeds, mortgages, contracts, or other instruments which the board of directors have authorized to
be executed, except in cases where the signing and execution thereof shall be expressly delegated by
the board of directors or by these by-laws or by statute to some other officer or agent of the
corporation; and in general shall perform all duties incident to the office of president and such other
duties as may be prescribed by the board of directors from time to time.
Section 6. Secretary. The secretary shall keep the minutes of the meetings of the board
of directors in one or more books provided for that purpose; see that all notices are duly given in
accordance with the provisions of these by-laws or as required by law; and be custodian of the
corporate records by the president or by the board of directors.
Section 7. Treasurer. The Treasurer shall have charge and custody of and be
responsible for all funds and deposit all such funds in the name of the corporation in such banks, trust
companies or other depositories as shall be selected in accordance with the provisions of these by-laws;
and in general perform all the duties incident to the office of treasurer and such other duties as from
time to time may be assigned to him by the president or by the board of directors.
ARTICLE VII
BOARD OF DIRECTORS
Section 1. General Powers. The affairs of the corporation shall be managed by its board
of directors.
Section 2. Composition, Tenure and Qualifications. The number of directors shall be
______. Each director shall be elected at the annual meeting of the members. Each director shall hold
office until the next annual meeting of the board of directors and until his or her successor has qualified.
Section 3. Regular Meetings. A regular annual meeting of the board of directors shall
be held at such times and places as may be designated by resolution by the board of directors. The
board of directors may provide by resolution the time and place for the holding of additional regular
meetings of the Board without other notice than such resolution.
Section 4. Special Meetings Special meetings of the board of directors may be called by
or at the request of the president or any two directors. The person or persons authorized to call special
meetings of the Board may fix any place, either within or without the State of Illinois, as the place for
holding any special meeting of the Board called by them.
Section 5. Notice. Notice of any special meeting of the board of directors shall be given
in accordance with applicable law.
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Section 6. Quorum. A majority of the board of directors shall constitute a quorum for
the transaction of business at any meeting of the Board, provided, that if less than a majority of the
directors are present at said meeting, a majority of the directors present may adjourn the meeting from
time to time without further notice.
Section 7. Manner of Acting. The act of a majority of the directors present at a meeting
at which a quorum is present shall be the act of the board of directors, except where otherwise provided
by law or by these by-laws.
Section 8. Informal Action by Directors. Any action required to be taken at a meeting of
the board of directors or any action which may be taken at a meeting of directors may be taken without
a meeting if a consent in writing, setting forth the action so taken, shall be signed by all of the directors
entitled to vote with respect to the subject mater thereof.
Section 9. Vacancies. Any vacancy occurring in the board of directors or any
directorship to be filled by reason of an increase in the number of directors shall be filled by the board
of directors. A director selected to fill a vacancy shall be elected for the unexpired term of his
predecessor in office.
Section 10. Compensation. Directors as such shall not receive any salaries for their
services, but by resolution of the board of directors, a fixed sum and expenses of attendance, if any, may
be allowed for attendance at each regular or special meeting of the Board; provided, that nothing herein
contained shall be construed to preclude any director from serving the corporation in any other capacity
and receiving compensation therefore.
ARTICLE VIII
COMMITTEES
Section 1. Committees of Directors. The board of directors, by resolution adopted by a
majority of the directors in office, may designate one or more committees, each of which shall consist of
two or more directors, which committees, to the extent provided in said resolution, shall have and
exercise the authority of the board of directors in management of the corporation; but the designation
of such committees and the delegation thereto of authority shall not operate to relieve the board of
directors, or any individual director, of any responsibility imposed upon them by law.
Section 2. Other Committees. Other committees not having and exercising the
authority of the board of directors in the management of the corporation may be designated by a
resolution adopted by a majority of the directors present at a meeting at which a quorum is present.
Any member thereof may be removed by the Board whenever in their judgment the best interests of
the corporation shall be served by such removal.
Section 3. Term of Office. Each member of a committee shall continue as such until the
next annual meeting of the board of directors of the corporation and until his successor is appointed,
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unless the committee shall be sooner terminated, or unless such member shall cease to qualify as a
member thereof.
Section 4. Chairman. One member of each committee shall be appointed chairman.
Section 5. Vacancies. Vacancies in the membership of any committee may be filled by
appointments made in the same manner as provided in the case of the original appointments.
Section 6. Quorum. Unless otherwise provided in the resolution of the board of
directors designating a committee, a majority of the whole committee shall constitute a quorum and the
act of a majority of the members present at a meeting at which a quorum is present shall be the act of
the committee.
ARTICLE IX
CONTRACTS, CHECKS, DEPOSITS AND FUNDS
Section 1. Contracts. The board of directors may authorize any officer or officers, agent
or agents of the corporation, in addition to the officers so authorized by these by-laws, to enter into any
contract or execute and deliver any instrument in the name of and on behalf of the corporation and
such authority may be general or confined to specific instances.
Section 2. Checks, Drafts, Etc. All checks, drafts or other orders for the payment of
money issued in the name of the corporation, shall be signed by such officers, agent or agents of the
corporation and in such manner as shall from time to time be determined by resolution of the board of
directors. In the absence of such determination by the board of directors, such instruments shall be
signed by the treasurer or an assistant treasurer and countersigned by the president or a vice president
of the corporation.
Section 3. Deposits. All funds of the corporation shall be deposited from time to time
to the credit of the corporation in such banks, trust companies or other depositories as the board of
directors may select.
Section 4. Gifts. The board of directors may accept on behalf of the corporation any
contribution, gift, bequest or devise for the general purposes or for any special purpose of the
corporation.
ARTICLE X
BOOKS AND RECORDS
The corporation shall keep correct and complete books and records of account and shall
also keep minutes of the proceedings of its board of directors and committees having any of the
authority of the board of directors.
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ARTICLE XI
FISCAL YEAR
The fiscal year of the corporation shall be determined by the board of directors.
ARTICLE XII
AMENDMENTS TO BY-LAWS
These by-laws may be altered, amended or repealed and new by-laws may be adopted
by a majority of the directors present at any regular meeting or at any special meeting, provided that at
least fifteen days' written notice is given of intention to alter, amend or repeal and to adopt new by-
laws at such meeting.
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2. Sample Form SS-4
Application for Employer
Identification Number
(3 pages)
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Note: Form SS-4 begins on the next page of this document.
Attention
Limit of one (1) Employer Identification Number (EIN)
Issuance per Business Day Effective May 21, 2012, to ensure fair and equitable treatment for all taxpayers, the Internal Revenue Service (IRS) will limit Employer Identification Number (EIN) issuance to one per responsible party per day. This limitation is applicable to all requests for EINs whether online or by phone, fax or mail. We apologize for any inconvenience this may cause.
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IV) Incorporation
1. Incorporation: Why and How
Entities become incorporated in order to protect leaders and other members from liability. Chapters
should consider incorporation to protect officers, directors, and other members from liability for the
debts and obligations of the Chapter.
2. Articles of Incorporation
Incorporation should be accomplished in the state in which the Chapter has a physical presence, or in
the state which is tied to its geographic territory. If a Chapter has no physical presence or geographic
territory, it can choose a state in which to incorporate. Illinois, for example, has very modern and
flexible non-profit corporation laws.
The Chapter will want to incorporate as a non-profit or not-for-profit corporation in its state. Some
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state will be available on the official state website. Filing fees to incorporate as a non-profit are typically
low.
A sample Articles of Incorporation for a Section 501(c)(6) professional society are attached. Note that
the language will be different if the Chapter is incorporating as a charity (501(c)3) rather than as a
professional society (501(c)(6)).
Each Chapter will be required to name a registered agent with an address within the state of
incorporation. The state will use that address to correspond with the Chapter. If the Chapter does not
have a physical presence in the state and does not have a volunteer willing to serve as registered agent,
the Chapter may contract with a corporate service, such as CT Corporation
(http://ct. wolterskluwer.com/ctcorporation) to act as registered agent in any state. States require that
any non-profit corporate status be maintained. Most states require yearly renewals of non-profit
corporate status. Some states require that renewal forms be filed every second or third year. Renewal
fees are typically low.
http://ct.wolterskluwer.com/ctcorporation
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1. Sample Articles of Incorporation
(3 pages)
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V) TAX EXEMPT STATUS
1. Tax Exempt Status: Section 501(c)(3) or (6)
The Internal Revenue Code grants tax exemption to many types of organizations. For Chapter purposes,
the most common will be Section 501(c)(3), charitable and educational organizations, or Section
501(c)(6), professional societies and trade associations.
Section 501(c)(3) organizations must act solely for a public benefit. Section 501(c)(6) organizations may
act for the mutual benefit of members of the profession or industry. Most Chapters will want to apply
under Section 501(c)(6) as a professional society or trade association.
Only Section 501(c)(3) organizations may grant charitable contribution deductions for voluntary
contributions. Dues are generally deductible when paid to either a Section 501(c)(3) or Section 501(c)(6)
organization. Corporations may make voluntary contributions to Section 501(c)(6) organizations and
obtain a marketing expense deduction. For further information on the differences between Section
501(c)(3) or Section 501(c)(6) organizations, visit the IRS website at www.irs.gov.
2. Application for Tax Exempt Status
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which permits the Chapter to avoid paying tax on most typical income streams, although tax must still
In order to obtain tax-exempt status, the Chapter should file an application with the Internal Revenue
Service.
Attached is a sample Form 1024, which can be used to apply for tax exemption as a Section 501(c)(6)
organization. Also attached is a sample cover letter to the Internal Revenue Service which lists all of the
documents which must accompany Form 1024. Form 1024 is available for download from the IRS
website.
3. Yearly Tax Filings
Whether your Chapter is incorporated or not, it must file a tax return each year. If your Chapter does
not have tax-exempt status, it should file Form 1120, which is the corporate income tax form. Form
1120 is also appropriate for unincorporated chapters which are taxable.
Tax-exempt organizations must file a tax form every year, known as Form 990. If gross receipts on
average are less than $50,000, the Chapter may file a very simple version of Form 990, known as Form
990N. This is only available for online filing. The Chapter is required to answer a few simple questions
and submit the form online.
http://www.irs.gov/
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If average revenues exceed $50,000, the Chapter will be required to file Form 990 or Form 990 EZ.
Chapters with more complicated revenue and expenses will want to involve a local accountant to make
sure that the tax filing is made accurately.
If a Chapter fails to file a required version of Form 990 for three years in a row, its tax-exempt status will
be revoked.
4. Other Relevant Tax Forms
If a Chapter has employees, it will be required to make federal and state filings with respect to
employment taxes. If a Chapter pays independent contractors more than $600 in a calendar year,
engages in raffles or other special activities, Forms 1099 may also be required.
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2. Sample Form 1024 and Attachments;
Sample cover letter to IRS
(9 pages)
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VI) INSURANCE
The best way to protect leaders and other members from liability is to incorporate the Chapter.
Incorporation will stop many types of liability at the Chapter door, and prevent the personal liability for
leaders and other members.
Incorporation will not protect the assets of the Chapter itself. That is why it is always advisable to
purchase insurance to cover common types of possible liability. Insurance can be purchased to cover
potential liabilities of leaders and other members which are not prevented by incorporation. In
addition, insurance will pay the cost of defense if an insured claim goes to court. There are several
common types of insurance which the Chapter may wish to consider.
1. General Liability Insurance
General liability insurance covers certain types of personal injury and property damage arising from
activities of the Chapter. It may also cover special claims, such as theft of cash or other assets. General
liability insurance is required if the Chapter sponsors live events. Physical injuries occur at live events,
and the Chapter will want to have insurance to pay the costs of defense and cover damages. If the
Chapter engages in any activities at which alcohol is served, the Chapter should consider purchasing a
general liability policy which covers damages arising from the consumption of alcohol at sponsored
events.
2. Directors and Officers Liability Insurance
This type of policy should cover copyright infringement, defamation, and similar claims, whether
definition of covered insureds.
3. Errors and Omissions Insurance
If the Chapter is engaged in providing substantive services to its members, other than general education
and networking, the Chapter should consider the purchase of Errors And Omissions Insurance to cover
claims connected with the provision of those services.
4. Information regarding Insurance for Chapters
Forms (provided through the American Society for Association Executives (ASAE)): 1. Directors and Officers Liability Insurance Application (1 page) 2. Application for The Hartford Non-Profit Choice All coverage parts (6 pages) 3. Application for the ASAE-Endorsed Association Office Package (2 pages)
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4. Event Questionnaire (1 page) 5. Certificate of Insurance Request Forum (1 page) 6. PowerPoint Presentation on D&O Insurance, recorded 5.5.12 (6 pages)
For further information about obtaining insurance, go to: www.asae-aon.com or contact:
Eric Johnson Aon Association Services 1120 N.W. 20th Street, Suite 600 Washington D.C. 20036 or Fax: 800.701.1982 attn. Eric Johnson phone: 800.453.5191 ext. 5374
http://www.asae-aon.com/
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